Crypto markets are “uniquely resistant to manipulation – who said so?
If you think that the Crypto markets are “uniquely resistant to manipulation, please raise up your hand…
If you have raised, then, read on…
Welcome to a Crypto and Data Analytics Blog.
Today, I just want to do a Crypto Analytics on SEC vs ETFs, which I think you might not just love it but have a clearer understanding.
All in all, know that I did this because I thought it value wise…
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WHY SEC REJECTED THE 9 BITCOIN ETF APPLICATIONS
SEC Rejects 9 Bitcoin ETF Applications From Proshares, Direxion And Graniteshares. The big question should be, was it a surprise or we saw it coming?
When the recent list of the first ETFs was to be placed before SEC, some crypto enthusiasts popped up on Twitter advocating that other enthusiasts show love to the head of SEC (woman in perspective – if I am not wrong), so that she might approve the applications.
However, the thing they do not realize is the unending politics we are playing today.
They don’t know that the Bitcoin whales have their way of manipulating everything only to suit them.
And why on earth should we bribe the SEC leader via Twitter following just to approve the ETFs when the effects will be massive on the innocent holders who bought Bitcoin when it was $17,000 or more?
And if the SEC does not approve them, does it mean that Bitcoin won’t be the currency it is today?
Let me shock you on this.
Don’t think that if the SEC just approves the ETFs as they are being placed on the table that it is (100%, in the future) to our advantage. No.
In fact, the SEC hasn’t said that Bitcoin nor the Blockchain is bad. The outcome solely rested on applicants’ failure to abide by individual sections of the Exchange Act.
Who EVEN does that (Blockchain is vague) when you have a massive list of the Top 35 world Bitcoin/Blockchain countries scrambling for leadership?
This is what they had to say.
“SEC emphasizes that its disapproval does not rest on an evaluation of whether bitcoin or blockchain technology more generally, has utility or value as an innovation or an investment.”
So, there is no need to bribe anybody to get instant gratifications for what we do not really understand. All it calls for is proper DYORing.
As we know, after asking the question “will the SEC ever approve the ETFs?, the result is that the U.S. Securities and Exchange Commission (SEC) has rejected a total of nine applications to list and trade various Bitcoin (BTC) exchange-traded funds (ETFs).
The rejection came after three different separate orders applied for it as was published on the SEC website.
SEC REJECTED THE 9 BITCOIN ETF APPLICATIONS; DID WE SEE IT COMING?
There is no doubt that Satoshi never created the Bitcoin for it to depend on regulations and mostly manipulations.
But what have we seen today?
Politics and manipulations are near possibilities
I don’t know how you see it, but you can’t do any business with a K-leg and get it right.
If the reason for it is self-interest only, then, we won’t accept it. Why not?
Based on ProShares registration in March 2018, SEC noted, most importantly that, “The ProShares Funds do not intend to hold Bitcoin Futures Contracts through expiration.
But instead, intend to either close or ‘roll’ their respective positions.”
The end effect?
This had been specifically designated as a potential risk for the two ETFs in question, in addition to the “extreme volatility and low liquidity” attributed to both Bitcoin spot and derivatives markets.
THE CME AND CBOE EFFECTS
Let me take us back a little bit.
We all saw it that the day the CME Bitcoin futures contract launched marked the top of this bull run.
The BitMEX Bitcoin Index (.BXBT) for instance flirted with $20,000. The aftermath two months proved that it was an amazing top at which to short Bitcoin.
In the words of Bitmex, “Now that large financial institutions could short Bitcoin by only posting USD, the thinking was/is that they will use their financial might to short Bitcoin into the ground.
The first thing most financial reporters fail to understand is that on a futures exchange, there is a long for every short. By definition, a futures exchange has no net impact”.
The truth is,
If the shorters at the margin are willing to accept lower prices than buyers at the margin, the contract will trade at a discount.
At that point, market makers will be net buyers, and then sell or short-sell Bitcoin on the spot markets.
More so, if the open interest is sufficient large, then this backwardation can negatively affect the price, right?
The above is a graph of the open interest in XBTUSD since January 2018. It is relatively small.
The maximum open interest over the period is $164 million.
Assume that all market makers are net long, which means they must short-sell Bitcoin spot to remain price neutral. That means that $164 million of Bitcoin must be sold.
That is not a per-day flow but a stock of short Bitcoin positions. The spot market on exchange trades exceeds $1 billion per day. The OTC volume is unknown, but it is not insignificant.
The short pressure at its logical maximum emanating from the CME and CBOE contract holders is meaningless.
Therefore, the effect on the broader market in actual flows is negligible. The contracts mainly bolster traders’ bullish sentiment.
SEC REJECTED THE 9 BITCOIN ETF APPLICATIONS; THE UNDYING EFFECTs
The SEC has today reinforced its stand over inadequate “resistance to price manipulation” in an insufficiently sized BTC derivatives market.
In the case of ProShares’ two ETFs, and repeated in the two other disapproval orders, this is what they had to say.
“Among other things, the Exchange has offered no record evidence to demonstrate that bitcoin futures markets are ‘markets of significant size.’
That failure is critical because, as explained below, the Exchange has failed to establish other means to prevent fraudulent and manipulative acts and practices will be sufficient, and therefore surveillance-sharing with a regulated market of significant size related to bitcoin is necessary.”
Note the line: the Exchange has failed to establish other means to prevent fraudulent and manipulative acts and practices.
WHY THE THREE ETFs WERE DISAPPROVED!
The simple reason for the disproval is that they haven’t met the demands of the entity they are.
The SEC judgment mentioned that they had not received any evidence that could prove the significant size of the Bitcoin futures market – a big concern if you ask me.
Look at it this way.
If you are a father who is not broke, you actually know that you’ve got some bills to settle; the children’s tuition, and so on.
And if you don’t perform your duty as a father, you don’t need or expect anybody to call you a father because your son might be the first to ignore you.
What am I saying?
If the ETFs represents what they say they are, or if they know that millions of people are involved in this, then, they want to have the properties of a financial institution whose functions have a way of deterring the lives of the masses.
This is what the U.S. Securities and Exchange Commission had to say about it.
"The Commission is disapproving this proposed rule change because the Exchange has not met its burden under the Exchange Act and the Commission's Rules of Practice to demonstrate that its proposal is consistent with the requirements of the Exchange Act Section 6(b)(5), in particular, the requirement that a national securities exchange's rules be designed to prevent fraudulent and manipulative acts and practices."
So, when we want to judge it, we have to place the coin over to see through.
HOW TO GET SEC’S APPROVAL?
Meet the demands, or sign an MOU that you will protect us from politics, and you will be approved.
It even was so clear as Bitcoin & XLM being scammy, that the President and COO of CFE, recently acknowledged in a letter to the Commission staff that ‘the current bitcoin futures trading volumes on Cboe Futures Exchange and CME may not currently be sufficient to support ETPs seeking 100 percent long or short exposure to bitcoin’.”
In other words, we (165+ crypto communities) need Crypto markets that are “uniquely resistant to manipulation.
THE EFFECTS OF THE ETFs ON BITCOIN + ALTCOINS
The outcome of Bitcoin ETFs also concerns the performance of Bitcoin markets in general.
As stated by CCN, so far, the market has reacted negatively to each one of rejection as mentioned above.
At the same time, the speculation of a positive outcome has historically pumped the Bitcoin value.
Only today, the BTC/USD had risen by over 7 percent ahead of the SEC’s announcement.
Now, this is my own thought as I will want to hear yours in the comment section.
We have to get something straight, and it is that the SEC hasn’t said Bitcoin or Blockchain are vague, no.
Even though Ali Hassan, the co-founder and the CEO of Crescent Crypto said that we might see a Bitcoin-only ETF in the next 18 months, the question is,
Do you value Bitcoin or Crypto price hype by manipulation than being protected from politics,
Or Bitcoin growing gradually to being a universal accepted currency?
In case we think that it does not make sense, let’s see the price acceptance of Bitcoin+ cryptos below and judge if it is a great result…
Without argument, I stand with one of my top thought leaders, Andreas Antonopolous. He said that “Opening up these ETFs only increase the ability of institutional investors to manipulate the prices of commodities,” he argued.
Note the line; increase the ability of institutional investors to manipulate the prices of commodities,”
So, let’s allow the SEC to do her duties without the pressure of demanding what might be an after-effect on us.
I would say again, without the SEC approval, let’s allow Bitcoin to grow naturally, else face the consequences we have seen between the first and the third world countries.
BITCOIN PRICE ROLLER COASTERS
There is no doubt that this might be a long walk because we have seen it over and over again.
We have witnessed lots of Bitcoin price jumps, so, a sudden ETFs price Super Mario Jump is not an issue. Let’s see the data below.
The Bitcoin Deeps so far.
In 2013, Bitcoin dropped from $233 to $67 in a single night!
That was a crash of 72% in 24 hours.
Of course, by November of that year, it was back up all the way to $1,150.
But then it crashed again!
Those that bought during flight 1.
Buying price – $67
ATH – $1150
Profit (before it crashed) = $1150 – $67 = $1083
Profit margin – positive
By December 2013, it was down more than 50% again to $500.
It recovered once more, until flight 3.
The Mt.Gox bitcoin exchange got hacked… and bitcoin again dropped 49%.
And in 2017, we saw two crashes rounding up to flight 4.
After rising to $3,000, bitcoin dropped back to $1,869, a fall of 36%.
And finally, we saw the flight 5 drop in 2017.
When China put restrictions on Bitcoin trading, the cryptocurrency dropped 37% from its $5,000 high.
We all celebrated December 2017 because at $17,000 everyone was happy.
But now? The current situation; at $6,400
It will happen if at all, the SEC finds a good ground to approve the ETFs or when Bitcoin grows naturally.
The truth is,
I am tired of hearing Volatility, let it grow naturally for it to be seen as a means of exchange everywhere, not just at crypto websites and Overstock (as a centric point).
In a set piece,
All you need to do is, be penitently patience by holding your coin.
If you don’t have a good wallet, get a better wallet and hold it, and if you have not bought some BTC to hold, now is the time while still at deep.
Just to note:
Our affiliate links are in this post. Meaning, if you use it and buy a product, we will be rewarded a little; a solution which will give you a good reading experience by banning G.ads from this site. Thank you for understanding
WHAT MAKES BITCOIN/CRYPTOCURRENCY DIFFERENT?
If you decide to keep your money in the bank, inflation can deal with it if left for 2 or more years.
Unless your country’s economic system is robust, keeping money in a bank is signing a death sentence.
If you keep your money with the banks, they will simply prey on your money by charging you monthly bills.
So, with the above established, what is in for all cryptocians?
The big question is, Should Investors Buy Now or Not?
WHY YOU SHOULD BUY BITCOIN NOW OR NEVER!
Should Investors Buy Now?
💡 Yes, if you believed in Cryptocurrency from the onset.
💡 Yes, if you have a good reason for buying it.
💡 Yes, if you don’t consider it as a Ponzi or QRS – Quick Rich Scheme.
💡 Yes, if you want to be the next Crypto Millionaire – joining these 7 men in Oblivion.
💡 Yes, if you want to be RICHHHHHHHHHHHHHH. Freaking Rich, but long term.
💡 Yes, if you have a simple 500 Crypto Wallet to store them.
💡 Yes, if you want to pass the wealth to your children.
💡 Yes, if you want to be relevant.
💡 Yes, if you are still in your early thirties and late 40’s.
Should Investors Buy Now?
💡 No, if you want to lose it out by procrastination or negligence.
💡 No, if you want the number of people that call crypto scam to increase.
💡 No, if you are disappointed that it isn’t a Quick Rich Scheme.
💡 No, if all the EFTs won’t be approved (on a good ground).
💡 No, if you want to borrow Money and buy Bitcoin/crypto.
💡 No, if your instinct/hunch says so; it might be right…
Should you want to buy?
And the wallets we recommend are paper if you can use, Digital Bitbox for beginners.
You can do yourself the best by buying some Bitcoin now, and if you can’t, do not kill yourself.
Just let it go and be humble about it.
WHAT TO DO IF YOU ALREADY HAVE BITCOIN – ONLY IF YOU FEAR A DECLINE…
Even though I might do it, let’s say, 20%, this is it.
If you fear that Bitcoin will go down to $2,000, you can transfer your funds into Tether.
Because, based on the functions of Tether, it acts as a bridge if only you will stay safe.
However, be careful in case the price goes even up…Remember, 20%.
THE REACTIONS OF CRYPTOCIANS ON THE ETFS VS SEC SHOW DOWN- TWITTER
Bitcoin doesn’t need an ETF! – Jtraderz
We do not need ETF, SEC, or whatever the FU·$%&”* system want to do. This is our opportunity to change the inappropriate way in which the world is ruled. GOD save Blockchain /Crypto. – Jorge Rodriguez.
Good! We don’t need ETFs!!! – Robert Lintag
ETF issue Nonsense.
We, Bitcoin enthusiast doesn’t care ETF approval. I remember the time when Bitcoin was hit the $19,000 value last year without any ETF approval. So expect Bitcoin Bull Run will still happened with or without ETF – Cryptocurrency_Related
We don’t need ETFs. Why people are so obsessed with them? – Joshua wendel
And the verdict?
I wouldn’t think more of it than say, let Bitcoin’s growth be natural. Let it flow…
Thank you for your support, reading this, and let me know what you think about this Crypto Analytics on The Ultimate Reason on Why SEC Rejected the 9 Bitcoin ETF Applications.
I hope it helped you. You will get of these if you join us.
Disclosure: this is not a financial advise but for educational purpose.